Foreigners to be banned from SA land ownership

A new bill set to be fast-tracked through parliament within a few months will no longer allow foreigners to buy property or land in South Africa. However, South Africans with foreign spouses might equally be affected

Foreign investors to SA are facing a new set of drastic regulations, as the government has announced a new expropriation bill, which would limit foreigners’ access to land in South Africa to leasing periods of 30 years only.

Under the Regulations of Land Holdings Bill, foreigners would not be allowed to own any land at all, and it is uncertain whether they would be allowed to renew the proposed leases.

While current foreign landowners would be exempted from the bill (as roughly seven percent of land in South Africa is owned by non-South African nationals) the announcement of the new regulation may still come as a shock to many South African nationals, who might be hoping to buy houses in Mzansi together with their foreign national spouses.

The government is hoping to rush the new bill through government in November and have it applied within five years. Though lacking the required two-third majority to push the law through parliament, the ruling ANC is likely to gain widespread support from the Economic Freedom Fighters (EFF) on this occasion, as the two parties may work closer together in the future – especially on issues pertaining to land reform and redistribution.

EFF caused outrage recently when they accused Sir Richard Branson, founder of Virgin, of stealing land when acquiring a hotel and vineyard estate in the Franschoek valley in the Western Cape. The EFF, who occupy ten percent of all parliamentary seats, run on a party-political programme which calls for land expropriation without any compensation, invoking a Zimbabwe-style leadership, where various bans on land ownership have sent the economy into ruins over the past twenty years.

The repercussions of a ban on foreigners acquiring land in South Africa would likely be equally unsupportable for SA’s economy. With a favourable exchange rate of the rand to foreign currencies, pleasant climate conditions and a welcoming property market, South Africa has been attracting more and more buyers from abroad year after year.

But Gugile Nkwinti, the Minister of Rural Development and Land Reform, said that the proposed bill allowing only locals to purchase land would be a fair way of ensuring that the property market stays favourable to the purchasing power of local buyers.

He also assured existing landowners from abroad that the new regulations would not infringe on their current property rights or lead to the expropriation of their existing properties, adding that such practices would be arbitrary and unconstitutional. However, especially in the case of SA nationals married to foreigners, the constitutional legalities of the proposed bill will likely be challenged, under the premise that any South African has a right to build and sustain a family, including the provision of a home, as he or she may desire to.

With a track record of suggesting other bills, which have been criticised for leading to irrational approaches to the ongoing challenges of land reform, Nkwinti’s long-term plans behind the new move may be somewhat uncertain. Having recently presented another bill, which would see the wholesale redistribution of half of all farmlands to the farm workers, who have been employed for ten years or more by their respective land owners, Nkwinti is seen as a polarising force in public and parliamentary opinion, with a political career already set to last beyond the days of President Jacob Zuma.

The ruling ANC has been trying to push various forms of legislation through parliament to address the matter of land reform. These include the Investment Bill as well as recent changes to mineral rights – all carefully worded in a manner, which might allow various laws to interact with each other and lead to unprecedented levels of government control over land.

It is unknown how the Regulations of Land Holdings Bill might interact with these pieces of legislation in a similar manner, but it is bound to limit property rights in any case.

The patchwork of land reform laws introduced by the ANC of late has created suspicion rather than building trust that the ruling party is trying to address post-apartheid inequalities in a just manner.

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